Growth in China's industrial output slowed down in July thanks to the central government's measures to cool the economy.

The country's industrial output rose 15.5 percent in July compared with the same month of last year, according to the National Bureau of Statistics.

But the growth rate was 0.7 percentage points lower than the previous month, the bureau said in a statement Tuesday.

In June, growth slowed 1.3 percentage points compared with May, earlier figures indicated.

For the first seven months, output rose 17.3 percent from the same period of last year.

Economist Zhang Xueying at the State Information Center said the slower rate suggests the central government's macro-control measures have taken effect.

China has taken a raft of measures since the second half of last year to try to cool down the economy. They include raising bank reserve requirements three times and curbing unwanted fixed asset investment projects.

"These measures have had a great impact on fixed asset investment and industrial output," he said.

Zhu Jianfang, an economist at China Securities, agreed the high industrial growth since last year has been dragged down.

"Industrial growth in July was not high at all," he said.

Zhang actually expressed fears for a fast decline in industrial output growth and fixed asset investment.

"I'm worrying about the possibility of an abrupt economic slowdown," Zhang said.

The government wants to bring economic growth down from current levels, where many resources, such as oil, have been constrained, but he said it must stay above 7 percent to keep people in work.

"We need to prevent such a downward trend from speeding up in the coming months," Zhang said.

Growth in the output of aluminium, a sector targeted by the government in its drive to reduce investment, slowed to 10.8 percent in July from 16.2 percent in June, the statistics bureau said.

Cement production growth fell to 11 percent from 13.2 percent, and cars to 5.4 percent from 20.4 percent.

Industrial output is an important indicator for gross domestic product. China's industrial output grew by 17 percent last year, and its gross domestic product grew by 9.1 percent.

During the first half of this year, industrial output grew year-on-year 17.7 percent and the country's gross domestic product rose 9.7 percent.

Statistics bureau spokesman Zheng Jingping said the overall performance of the country's economy was good.

The national economy kept stable with fast growth, while economic efficiency was improved continuously, he said.

Uncertainties and unhealthy factors in economic performance have also been placed under initial control, Zheng said.

But the government should be aware at the same time that those prominent problems existing in the economy have not been rooted out fundamentally and more efforts are still needed, he said.

Energy and transport bottlenecks and rapid growth in fixed asset investments in some sectors are still troubling, he said.

(China Daily August 11, 2004)